Stocks Programmed for Big Gains

There were probably several meetings going on Wednesday afternoon to discuss the bond market's selloff. At least one of the meetings was probably at a large institution and the action plan at the end must have been: Decrease bond allocation, increase stock allocation.

And so a program was born.

Only a program could send 468 of the 500 stocks in the S&P 500 up at the opening bell, says Marc Pado, chief market analyst at Cantor Fitzgerald.

The surge of buying that sent the major indices up in the morning went unabated throughout the day Thursday, despite an equally impressive jump in the price of oil. Investors were single-mindedly focused on shoving the bears out of the way and making last-ditch, year-end allocations into stocks that sent major averages soaring.

The Dow Jones Industrial Average reached a new all-time high Thursday, closing up 0.8% at 12,416.76, while the S&P 500 closed at a new six-year high, up 0.9% at 1425.49. The Nasdaq Composite had an impressive gain as well Thursday, finishing up 0.9% to close at 2453.85.

"I think a lot of investors were waiting for a big fall correction, and it never came, but those people would have been more fully invested or aggressively invested right now if we'd had that correction," says Margaret Patel, portfolio strategist at Pioneer Investments. "There is some repositioning of money going on that will help the market in the last couple of weeks of the year."

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